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The Film Production Services Tax Credit applies to eligible claimants who incur production
expenditures for making an accredited production in Wisconsin.
An "Eligible Claimant" for the Film Production Services Tax Credit is a
film production company that operates an accredited production in
Wisconsin, if the company owns the copyright in the accredited
production or has contracted directly with the copyright owner or a
person activing on the owner's behalf, and if the company has a viable
plan, as determined by the Department, for the commercial distribution
of the finished production.
An "Accredited Production" is defined as a film, video, electronic
game, broadcast advertisement or television production, as approved by
the Department of Commerce (Department), for which aggregate salary and
wages included in the cost of production for the period ending 12
months after the month in which the principal filming or taping of the
production begins exceeds $100,000 for a production that is 30 minutes
or longer, or $50,000 for a production that is less than 30 minutes.
An Accredited Production does not
include any of the following, regardless of production costs:
- News, current events or public programming of a civic or
governmental function, or a program that includes weather or market
reports.
- A talk show.
- A production with respect to a questionnaire or contest.
- A sports event or sports activity that is exclusively
competitive
in nature (A travel promotion that addresses a sports event or sports
activity is eligible).
- A gala presentation or awards show.
- A finished production that solicits funds.
- A production for which the production company is required
under
federal law to maintain records with respect to performers in programs
with sexually explicit content.
- A production produced primarily for industrial, corporate
or institutional purposes.
The Department will consider whether all of the following are likely in
determining whether to accredit a production:
- The production would not occur in Wisconsin without the tax
benefits provided under the program.
- The production would enhance economic development in
Wisconsin.
- The production would enhance the potential for increasing
the film, video or electronic game industry in Wisconsin.
- The production would not hurt the reputation of the State
of Wisconsin.
The credits can be earned in three different ways:
Salaries and Wages
Production Expenses
Sales Taxes
 Salaries and Wages
An Eligible Claimant may claim as a credit against the
indivudual
and corporate income and franchise taxes an amount equal to 25% of the
salary or wages paid by the claimant to the claimant's employees in the
taxable year for services rendered in Wisconsin to produce an
accredited production and paid to employees who were residents of Wisconsin
at the time they were paid.
The salary or wages must be paid for services rendered after
December 31, 2007, and directly incurred to produce the accredited
production. The tax credit may not be claimed for the
salaries or
wages of the two highest-paid Wisconsin resident employees.
Production Expenses
An Eligible Claimant may claim as a credit against the
individual
and corporate income and franchise taxes an amount equal to 25% of the
production expenditures paid by the claimant in the taxable year to
produce an accredited production.
Production Expenditures means any expenditures that were incurred in
Wisconsin and directly used to produce an accredited production,
including expenditures for set construction and operation, wardrobes,
make-up, clothing accessories, photography, sound recording, sound
synchronization, sound mixing, lighting, editing, film processing, film
transferring, special effects, visual effects, renting or leasing
facilities or equipment, renting or leasing motor vehicles, food,
lodging, and any other similar expenditures as determined by the
Department.
Production Expenditures also includes expenditures for the following:
-
Music
that is performed,
composed or recorded by a musician who is a resident of Wisconsin, or
published, or distributed by an entity that has its headquarters in
Wisconsin.
-
Air travel that
is purchased from a travel agency or company that has its headquarters
in Wisconsin.
-
Insurance
that is purchased from an insurance agency or company that has its
headquarters in Wisconsin.
Production Expenditures do
not include the following:
- Any salaries or wages paid directly by an Eligible
Claimant to the Eligible Claiment's employees.
- Expenditures for the marketing and distribution of an
accredited production.
The tax credits earned for eligible Production Expenditures are
refundable. If the amount of the tax credit exceeds the
taxpayer's income or franchise tax liability, the amount of credit not
used to offset the tax due will be certified by the Department of
Revenue and refunded to the claimant.
Sales Tax
An Eligible Claimant may claim as a credit against the individual and
corporate income and franchise taxes an amount equal to the Wisconsin
sales and use taxes that the claimant paid in the taxable year on the
purchase of tangible personal property and taxable services that were
used directly in producing an accredited production in Wisconsin,
including all stages of production, from the final script to the
distribution of the finished production.
The tax credits earned for eligible sales taxes are non-refundable.
Unused tax credit amounts may be carried forward up to 15
years
to offset future tax liabilities.
For more information about
Wisconsin's film tax credit programs, contact Steve Sabatke, Economic
Development Consultant, Bureau of Business Finance & Compliance,
Wisconsin Department of Commerce
201 West Washington Avenue
Madison, WI 53707-7970
Phone: 608/267-0762
Fax: 608/264-6151
Email: Steven.Sabatke@Wisconsin.gov
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